'Budget Fatigue' Can Lead to Holiday Debt

WASHINGTON -- Last night, I hopped on the Internet with the intention of buying a few gifts. Money, as always, is tight, so I figured I could go bargain hunting without wasting time or gas.

As colorful, enticing images of gift possibilities danced across the screen, I swiftly shot from site to site, half a dozen windows open at a time, comparing prices and swooping in to buy more and more.

I felt exhilarated. I was spending guilt-free for the first time in years. I was clicking buttons rather than forking out cash, and that’s OK, right?

My bank account told another story when I accessed it later that night.

Today, I learned I had fallen victim to a phenomenon known in some financial circles as “budget fatigue.”

It’s easy to get frustrated and tired of tight purse strings, particularly after years of economic setbacks, and decide to let loose over the holidays. But today’s spending excess is tomorrow’s debt hangover.

In a recent article, Dan Radovsky of USAA offers some tips to combat this trend:

** Know your budget. Be realistic about what you have to spend, make a gift-giving list and stick to it, whether shopping in a store or online. If you’ve been on a strict budget all year, don’t veer off course now.

** Paper or plastic? The payment method you use can have a big impact on the final cost of the gift. If you decide to charge now and pay later, high interest rates and late fees can take an expensive toll. You may end up spending a lot more than you intended. Plus, what’s the point of bargain hunting if you end up with fees tacked on? An expert suggests people who want to use plastic stick to a debit card, but even then be wary of piling up teller machine fees.

** Try layaway. Layaway plans encourage early shopping and enable people to spread out the financial burden over a period of time rather than have it hit all at once. These plans may involve a small fee, but that won’t come close to a credit card’s interest rates and late fees.

Bottom line, Radovsky said, is to avoid letting budget fatigue nudge common sense aside. Have fun, but within limits.

Now that I’m a smarter shopper, I’m off to reduce the damage of my Internet shopping spree so I can get back on my budget track.